Harare - Tongaat Hulett's Zimbabwe operations recorded significantly reduced revenues and profits for the year to end-March 2016.
A result statement released on Monday by parent company Tongaat Hullet [JSE:TON] showed that the Zimbabwe operations recorded a 21% revenue drop to $257m, down from $314m in the prior comparative year.
After adjusting for stock movements, revenue was however down by 8.04% to $263m from $286m prior year comparative.
Sugar sales for the period under review slipped to 403 000 tonnes, down from 491 000 prior in FY2015.
Export volumes were lower after a drop in international sugar prices.
“There were both lower export sales volumes and lower export prices while domestic market sales volume levels have been maintained,” said the group.
Operating profit was 97% lower after operating profits, including wages, increased to $141m from $135m.
The group said US dollar strength had exerted pressure, particularly in respect of US dollar-based costs (such as wages and salaries) and euro-based revenues.
Production also fell by 7.42% to 412 000t from 445 000t, with the group attributing the performance to poor growing conditions as a result of low rainfall, restricted irrigation levels and, to a lesser extent, electricity unavailability.
The drought is expected to continue impacting total sugar production in 2016/17, while the quantum of irrigation has been reduced as a measure against poor rainfall and low dam levels.